Eircom's bill pay change to hit poorer clients
Published 27/08/2010 | 05:00
FURY erupted yesterday over plans by Eircom to pile huge financial pressure on people who pay their bills in small instalments.
The firm intends to force cash-strapped customers who had until now paid weekly instalments of €5 upwards to now pay a minimum of €20 towards their bills.
Pensioners and welfare recipients who normally pay off their Eircom bill every week in small chunks will now have to pay at least €20 at a time or the full amount if the bill is lower than €20.
Eircom's move comes after the ESB was attacked for the huge number of people it is cutting off every month -- or "de-energising" in the words of the electricity company.
The decision by Eircom to impose the minimum €20 payment from October 1 was angrily attacked by TDs, Age Action Ireland and the Money Advice and Budgeting Service (MABS).
They argued the changes would have a significant impact on pensioners and those on low incomes who opt to pay just €5 or €10 off their bills every week.
By limiting the minimum payment to €20, Eircom is "undermining" what is good budgeting practice for anyone on a low or fixed income, it was claimed.
Some people may now run into difficulties paying their bills because they have not made regular payments.
There are more than 370,000 people in receipt of pension payments from the State -- many of whom are thought to be Eircom customers.
A spokeswoman for Eircom would only say that 10pc of its customers pay in instalments and refused to provide a figure for the company's total number of customers because it is "commercially sensitive".
But it is thought the company has in the region of 1.5m landline customers.
Fianna Fail TD Darragh O'Brien claimed there were around 250,000 customers who made regular payments towards their bills and who would be directly affected by Eircom's changes.
The Fianna Fail backbencher said he was now worried Eircom's "secret plan" could be copied by other gas, electricity and cable companies. He described Eircom's move as "shameful".
Under the current system, customers can budget their monies week-to-week but the new system means the local post office will not be accepting payments of less than €20.
Last night, Age Action Ireland called on Eircom to reverse its plans, claiming the set payment requirement would make it more difficult for older people to ensure their phone bills were promptly paid.
Many older people have contacted the organisation in recent days to voice their concern at the changes.
Age Action Ireland spokesman Eamon Timmins said many older people regularly paid €5 or €10 towards the cost of their phone bill when they collected their pensions.
"By doing so, it means they do not let a large bill build up. This means they ensure their bill is always paid promptly so they do not run into financial problems," he said.
By limiting the minimum payment to €20, Eircom is undermining what is good budgeting practice for anyone on a low or fixed income, the group's spokesman added.
Ultimately, the plans could lead to older customers switching phone supplier or running into difficulties paying their bills because they have not made regular payments.
Household debt in Ireland is now estimated at more than €100bn, with Ireland second-highest in Europe if debt is calculated as a percentage of gross national product. Organisations such as MABS have been advising cash-strapped and debt-ridden people to pay off their debts in regular instalments.
A spokesman for MABS confirmed it is now in contact with Eircom as many of its clients on low incomes have been paying smaller payments every week.
Asked to explain the changes, Eircom would only say that it was designed to "simplify its payment transaction process".
The Department of Communications last night declined to comment on the changes.